Housing real estate market in the eurozone recovered from inflation pressure, expensive energy and high interest rates, but the high cost of housing has limited housing accessibility, European Central Bank (ECB) warned.
Data for the third quarter 2024. The prices have already reached a high level of summer 2022. year, they point out in the ECB, concluding that “their recovery was significantly faster than after the global financial and debt crisis” in the eurozone. “
During the year and a half, the prices have fallen by three percent, if the lowest and highest point in the cycle is taken into account, while in a two-year crisis were reduced by almost five percent, notes in the ECB.
Where did prices fall most?
The price drop was concentrated on a smaller number of countries, only 12 of 20 covered by research, and the main burden carried Germany, which took the role of the ECB peripheral in the economic newsletter.
The relatively gentle decline in the price spared the banks and balance sheets of banks, but their level remains high, which has negatively affected housing accessibility even in the conditions of “less strict” monetary policy.
New price growth in sight
Real estate prices could continue to grow in the next quarters, given the limited offer and stable demand, forecast in the ECB, noting that such a trend may not be good for the economy as a whole, investor me.
In June last year, the European Central Bank started reducing the key interest rates, considering that the “appropriate conditions” were created to mitigate monetary policy, given the fall of inflation. From July 2022. until September 2023. Interest increased by 4.5 percentage points.
